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PMA panel sees big changes by 2022

ANAHEIM, Calif. – By 2022, the fresh produce industry can expect millions more mouths to feed, the potential of robots harvesting strawberries and frugal customers who shop online.

In a view of the future that includes technology that would change all parts of the supply chain, Bryan Silbermann had some help introducing Fresh Summit 2012 attendees back to the future.

A state of the industry panel moderated by Silbermann included four other industry leaders who considered what the world would like in 2022 and how the industry should prepare now.

Silbermann, president and chief executive officer of the Produce Marketing Association, asked attendees to consider a world population of nearly 8 billion people.

“Think about the world in 2022, and ask yourself how much of your current world will no longer exist ten years from now,” he said.

He suggested the industry would shift from a business-to-business perspective to a business-to- consumer view of the world. Increasing ways of connecting with consumers through technology would make consumers closer than ever in 2022, Silbermann said.

“Consumers have become our friends, advisors and advocates,” he said. “They have carved out their rightful place as the drivers of demand and by listening to them and interacting with them and restructuring our companies to better serve them and that is the sweet spot.”

Vernon Crowder, vice president and agriculture economist for Rabobank, Fresno, Calif., said the world’s population will near 8 billion by 2022 and 9 billion by 2050. More than 97% of population growth will come in developing countries, Crowder said.

About half the world’s population is living in urban areas and that percentage will increase to 70% by 2050. The world's population will increase by 30% in the next 40 years, but demand for food will double, he said.

While demand will continue to increase, the world’s agricultural productivity is not increasing at the same rate, he said. With tight water, energy and labor supply, Crowder said growers need better productivity, friendly trade policies, biotech crops and technology in the supply chain to reduce an estimated 1.5 billion pounds of food wasted every year.

Leslie Sarasin, president and chief executive officer of the Food Marketing Institute, Washington, D.C., told Fresh Summit attendees that consumers in 2022 will be even more value-driven than 2012. In 2008, about 60% of shoppers identified themselves as being value seekers, while by 2022 between 80% and 90% are value-seeking customers, she said.

“Attitudes of frugality have beecome the new norm,” Sarasin said. “What we are dealing with now (in 2022) is the aftermath of the great recession of 2008,” she said.

Tools for shopping have allowed customers in 2012 to shop smarter and save money, she said, even as they are in stores. Retailers will want the shopper’s experience in the store to mirror the ease of shopping online.

Before, bargain hunting used to involve strolling the aisles and looking at newspapers to see what kind of promotions were there,” she said. “Now it is all about scrolling screens.”

Sarasin said e-commerce will continue to expand in influence and will start to claim more grocery and fresh produce sales by 2012.

Partially in response to the rise of remote shopping, store formats will shrink and become more focused on price, assortment or convenience.

Sarasin said retail stores will experiment in multi-channel platforms, suggesting partnerships between traditional and online retailers. Traditional supermarkets will have to be much more focused on their customers and specific items to appeal to particular neighborhoods, he said.

Retail stores of 2022 will go back to the future by more closely resembling the service and value of mom and pop stores of the 1920s while embracing technology necessary to connect with consumers, she said.

Victor Smith, president and chief executive officer of Fresh Innovations, LLC, joked that he would be about 10 pounds lighter in 2022 because he began to “practice what he preached” in making fruits and vegetables a bigger part of his diet.

A concerted effort by industry groups changed government policy by 2022 to encourage more fruit and vegetable consumption, he said.

“Our young generation became the largest consumer groups for our products,” he said. “The tables (in 2022) are now turned; our children made us eat our vegetables,” he said.

“The FDA finally recognized our success and chose to align with us as a vested partner and validated that our risk assessment and mitigation procedures were working,” he said.

Elliot Grant, founder of YottaMark Inc., said millennial shoppers will have driven the biggest change in retailers since the Baby Boomers. By 2022, a 25-year old shopper will go in a store with a computer-embedded app that informs her how fresh the salad and pineapples are.

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About the Author:

Tom Karst

Tom Karst is national editor for The Packer, covering issues of importance to the produce industry including immigration, farm policy and food safety.
He began his career with Vance Publishing Corp., The Packer's parent company, in 1984 as one of the founding editors of ProNet, a pioneering electronic news service for the produce industry. Tom has also served as markets editor for The Packer and editor of Global Produce magazine in his time at Vance Publishing, among other positions.
Tom is also the main author of Fresh Talk, www.tinyurl.com/freshtalkblog, an industry blog that has been active since November 2006.
Previous to Vance, Tom worked from 1982 to 1984 at Harris Electronic News, a farm videotext service based in Hutchinson, Kansas.
Tom has a bachelor’s degree in agricultural journalism from Kansas State University, Manhattan.
He can be reached at tkarst@thepacker.com and 913-438-0769. Find Tom's Twitter account at www.twitter.com/tckarst.